Explanatory Memorandum to COM(2007)698 - Amendment of Directive 2002/22/EC on universal service and users’ rights relating to electronic communications networks, Directive 2002/58/EC concerning the processing of personal data and the protection of privacy in the electronic communications sector and Regulation (EC) No 2006/2004 on consumer protection cooperation - Main contents
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This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2007)698 - Amendment of Directive 2002/22/EC on universal service and users’ rights relating to electronic communications networks, ... |
|---|---|
| source | COM(2007)698  |
| date | 13-11-2007 |
- Grounds for and objectives of the proposal
Ensuring a high level of protection of consumers’ and users’ rights, including the right to privacy and data protection in electronic communications, is one of the crucial elements of an inclusive Information Society, enabling the smooth development and wide take-up of new innovative services and applications. The EU framework for electronic communications networks and services is built on the premise that an open and competitive market offers the best means of promoting innovation and user choice. Recognising, however, that competition alone may not be sufficient to satisfy the needs of all citizens and protect users’ rights, the competition-based approach of the framework is complemented by specific provisions safeguarding universal service and users’ rights, as well as the protection of personal data.
This proposal is one of three legislative reform proposals to amend the current regulatory framework. This legislative reform proposal covers changes to the Universal Service Directive i and the Directive on privacy and electronic communications i. A second legislative reform proposal i covers changes to the other three directives. This is complemented by a third legislative proposal to create a European Electronic Communications Market Authority (hereinafter, “the Authority”) i. The three legislative proposals are accompanied by an Impact Assessment i and a Communication setting out the main policy lines and reporting on the public consultation i.
The present legislative reform proposal adapts the regulatory framework by strengthening certain consumers’ and users’ rights (in particular with a view to improving accessibility and promoting an inclusive Information Society), and ensuring that electronic communications are trustworthy, secure and reliable and provide a high level of protection for individuals’ privacy and personal data. The proposal does not alter the current scope or concept of universal service in the EU, which will be subject to a separate consultation in 2008. It is in line with the Commission’s Better Regulation Programme, which is designed to ensure that legislative interventions remain proportionate to the political objectives pursued, and forms part of the Commission’s overall strategy to strengthen and complete the internal market.
More specifically, the objectives of the present proposal are two-fold:
1. Strengthening and improving consumer protection and user rights in the electronic communication sector, through — amongst other aspects —giving consumers more information about prices and supply conditions, and facilitating access to and use of e-communications, including emergency services, for disabled users; and
2. Enhancing the protection of individuals’ privacy and personal data in the electronic communications sector, in particular through strengthened security-related provisions and improved enforcement mechanisms.
- General context
As part of the renewed Lisbon strategy for growth and jobs, the Commission proposed in June 2005 a new strategy — the i2010 Initiative: A European Information Society for growth and employment — laying down broad policy orientation to promote an open and competitive digital economy. The creation of a Single European Information Space, which is one of the main pillars of the i2010 Initiative, includes the reform of the regulatory framework as one of its key challenges, with a particular emphasis on security and the protection of privacy and personal data. Furthermore, ensuring an adequate level of universal service provision is crucial for achieving an inclusive Information Society.
In line with the principles of better regulation, the framework provides for a periodic review to make sure that it keeps pace with technological and market developments. On 29 June 2006 the Commission presented a report i to the European Parliament and the Council on the functioning of the regulatory framework for electronic communications networks and services. The Report noted that the framework had yielded considerable benefits for citizens, consumers, and businesses in terms of better choice, lower prices and more innovation, but there was room for improvement in the field of consumer protection and security to ensure that it kept pace with technological developments and remained effective for the coming decade.
- Existing provisions in the area of the proposal
The objective of this proposal is to amend two Directives: the Universal Service Directive and the Directive on privacy and electronic communications.
- Consistency with the other policies and objectives of the Union
The Universal Service Directive sets out sector-specific measures that complement existing EU law in the field of consumer protection. The Directive on privacy and electronic communications complement Directive 95/46/EC on the protection of individuals with regard to the processing of personal data and on the free movement of such data by introducing specific provisions concerning the electronic communications sector.
- Consultation of interested parties
Consultation methods, main sectors targeted and general profile of respondents
The Commission services launched a two-phase consultation starting at the end of 2005. The first phase included a call for input, which involved a public hearing with over 440 participants (held in January 2006) and around 160 submissions from stakeholders. In the call for input, stakeholders were invited to give their views on general topics relating to the regulation of electronic communications. These views were taken into account in the preparation of the Commission Communication of 29 June 2006 on the Review i, and the accompanying Staff Working document and the Impact Assessment. The publication of these documents launched the second phase of the public consultation, which lasted until October 2006. A public workshop was held in October 2006 to allow interested parties to express their views on the consultation documents. A total of 224 responses were received from a wide range of interested parties, both inside and outside the EU. 52 industry associations, 12 trade associations and worker’s unions, and 15 user’s associations sent written comments, as did 18 Member States and the European Regulators Group (ERG).
In general, the proposals made in the area of Universal Service were supported by consumer organisations and the ERG, as well as by most Member States. On the other hand, operators were generally in favour of self- and co-regulatory approaches. This was particularly the case for improving transparency of tariffs and facilitating the use of electronic communications services and equipment and access to emergency services for disabled users.
Concerning the proposals to enhance the security provisions of the Directive on privacy and electronic communications, the submissions showed wide support for the overall objectives, but the opinions expressed were more nuanced with respect to the proposed means for achieving these objectives. Generally speaking, Member States expressed cautious support for the Commission proposals, consumer organisations were also in favour and Data Protection Authorities considered that the Commission proposals did not always go far enough. On the other hand, the industry tended to favour alternatives that did not involve regulatory intervention. The results of the public consultation have been taken into account in the present proposal.
- Collection and use of expertise
Scientific/expertise domains concerned
Study “Preparing the next steps in regulation of electronic communications — a contribution to the review of the electronic communications regulatory framework” (Hogan & Hartson, Analysys), 2006.
The study confirmed the general soundness of the regulatory framework, its objectives and the overall approach. However, it indicated the need for a number of adjustments to be made in certain areas.
The study examined measures safeguarding users’ rights, as well as the privacy, security and confidentiality of on-line communications. It put forward a number of recommendations for change, including improving transparency and publication of information for end-users, the introduction of security breach notification under the Directive on privacy and electronic communications, and an explicit right for national authorities to provide guidelines on security.
The study is available at:
ec.europa.eu/information_society/policy/ecomm
- Impact assessment
The impact assessment report of June 2006 provided an initial analysis of a set of broad policy options. This analysis was refined following the public consultation. The second impact assessment published together with the present proposal focuses on more specific options for those proposals with the most far-reaching effects.
The groups affected most by the proposed changes are businesses, public administrations, citizens and European society at large, since all are users of electronic communications. This stakeholder group is not homogeneous and its members often have conflicting interests. The key players affected by the present proposals are electronic communications services providers and network operators, and national regulatory authorities (NRAs).
The impact assessment is available at: ec.europa.eu/information_society/policy/ecomm
Contents
- LEGAL ELEMENTS OF THE PROPOSAL
- BUDGETARY IMPLICATION
- 2. CONSULTATION OF INTERESTED PARTIES AND IMPACT ASSESSMENT
- Summary of responses and how they have been taken into account
- Summary of advice received and used
- Means used to make the expert advice publicly available
- 5. ADDITIONAL INFORMATION
- Improving the transparency and publication of information for users
- Facilitating the use of and access to eCommunications for disabled users
- Improving caller location obligations related to emergency services
- Technical adjustments to the wording of the Directive
- Removal of outdated or obsolete provisions
- Article 2: changes to the Directive on privacy and electronic communications
- Notification of security breaches by network operators and ISPs
- Improved enforcement mechanisms
- Technical adjustments to the wording of the Directive
- Removal of outdated or obsolete provisions
- Article 3: amendment to the Regulation (EC) No 2006/2004 on consumer protection cooperation
- 305 Summary of the proposed action
The proposal aims to amend the existing Universal Service Directive and the Directive on privacy and electronic communications.
The main proposed amendments to the Universal Service Directive are the following:
- improving the transparency and publication of information for end-users;
- facilitating use of and access to e-communications for disabled users;
- facilitating the switching of suppliers by consumers through, among other things; strengthened provisions on number portability;
- improving obligations related to emergency services;
- ensuring basic connectivity and quality of service; and
- modernising specific provisions of the Directive to bring them into line with technology and market developments, including the deletion of a number of obsolete or redundant provisions.
As regards the Directive on privacy and electronic communications , the main proposals are as follows:
- introducing mandatory notification of security breaches resulting in users’ personal data being lost or compromised;
- strengthening implementation provisions related to network and information security to be adopted in consultation with the Authority;
- strengthening implementation and enforcement provisions to ensure that sufficient measures are available at Member State level to combat spam;
- clarifying that the Directive also applies to public communications networks supporting data collection and identification devices (including contactless devices such as Radio Frequency Identification Devices);
- modernising certain provisions that have become outdated, including the deletion of some obsolete or redundant provisions.
- Legal basis
Article 95 EC320
- Subsidiarity principle
The proposed action entails amendment of the existing EU regulatory framework and thus concerns an area in which the Community has already exercised its competence. The proposal therefore complies with the subsidiarity principle as set out in Article 5 of the EC Treaty. The regulatory model of the framework is based on the principle of decentralised regulation in Member States, giving national authorities responsibility for overseeing national markets according to common set of principles and procedures.
- Proportionality principle
This proposal complies with the proportionality principle in that it sets forth a minimum level of harmonisation, leaving the definition of the implementing measures to the Member States or the national regulatory authorities. When a higher level of harmonisation is required, provision is made for the Commission to adopt detailed technical implementing measures. This approach allows for ex ante regulation to be flexible enough to respond to on-going technology and market changes in the sector while respecting the objectives and principles defined by the legislator.
The proposed amendments do not go beyond what is necessary to achieve the aim of better regulating the sector and ensuring a high level of protection of users’ rights. They comply with the principle of proportionality set out in Article 5 of the EC Treaty.
- Choice of instruments
Proposed instrument: directive.
Other means would not be adequate as the object of this proposal is to amend two existing directives.
The proposal has no implication for the Community budget.
- Simplification
The present proposal will simplify administrative procedures for public authorities withdrawing some outdated provisions, such as the obligation to determine a minimum set of leased lines and other obligations under the previous framework (retail tariffs, carrier selection and carrier pre-selection). Other simplifications are introduced for national regulatory authorities, which will be no longer required to submit information on the retail controls applied and the cost accounting systems used by the undertakings concerned.
Furthermore, it is proposed to repeal other outdated provisions including, for example, the measures to facilitate the transition between the “old” framework of 1998 and the 2002 framework.
The present proposal is included in the Commission’s rolling programme for the up-dating and simplification of the acquis communautaire and its Work and Legislative Programme under the reference 2007/INFSO/001.
- Repeal of existing legislation
The adoption of the proposal will lead to the repeal of Commission Decision 2003/548/EC of 24 July 2003 on the minimum set of leased lines with harmonised characteristics and associated standards referred to in Article 18 of Directive 2002/22/EC (Universal Service Directive) i.
- Review/revision/sunset clause
The Directives to be amended already include a regular review clause.
- Correlation table
Member States are required to communicate to the Commission the text of national provisions transposing the Directive as well as a correlation table between those provisions and this Directive.
- European Economic Area
The proposed act concerns an EEA matter and should therefore extend to the European Economic Area.
- Detailed explanation of the proposal
Article 1: changes to the Universal Service Directive
The aims of the proposed changes are as follows:
In Article 21, paragraphs i to i: the aim is to increase price transparency to the benefit of consumers by imposing on operators an obligation to publish comparable, adequate and up-to-date information in an easily accessible form (paragraph 2) and allowing third parties to use publicly available tariffs (e.g. for the purpose of selling or making available interactive guides) and national regulatory authorities to make such guide available when these are not available on the market (paragraph 3). NRAs are given powers to require from operators better tariff transparency (paragraph 4) as well as clear information on possible restrictions on access to all types of content and applications (paragraph 5). The possibility for the Commission to take implementing measures is intended to ensure, where appropriate, a minimum level of harmonisation in this area (paragraph 6).
In Article 7: this replaces the possibility for Member States to take specific measures for disabled users with an explicit obligation to do so.
In Article 22: this extends the NRAs’ powers to request operators to publish information for end-users on the quality of their services to also include equivalent access for disabled end-users.
In Article 26 i: this imposes on Member States an obligation to ensure that disabled end-users are able to access emergency services with a view to achieving fully inclusive electronic communications.
In Article 33: this provides for a Community mechanism to address eAccessibility issues in order to ensure that disabled users have equivalent access to electronic communications services as enjoyed by other end-users (paragraph 4). Paragraph 3 requires the Member States to provide the Authority with information on the measures taken and the progress towards eAccessibility.
In Article 26: this modernises the Directive so as to take account of market and technological developments in order to ensure that users of a service offering outgoing calls are able to access emergency services (paragraph 2) and to strengthen the obligation to pass information to emergency authorities (paragraph 5). The possibility for the Commission to take implementing measures, in paragraph 7, is intended to ensure, where appropriate, a minimum level of harmonisation in this area.
Basic access and quality of service (“net neutrality and freedoms”)
In Article 20 i: this provides for a transparency mechanism concerning possible restrictions on end-users’ choice of lawful content and applications in order to empower end-users to make an informed choice of services, thus allowing them to reap the full benefits of technological developments in the Information Society.
In Article 22: this grants to the national regulatory authorities the power to prevent degradation of quality of service by setting minimum quality levels for network transmission services for end-users. The possibility for the Commission to take implementing measures is intended to ensure, where appropriate, a minimum level of harmonisation in this area (paragraph 3).
Other consumers’ and users’ rights
In Article 9: this allows national regulatory authorities to monitor retail tariffs if no undertakings are designated as a universal service provider and clarifies the scope of application of special tariff options. Disability is added as a criterion in paragraph 3.
In Article 20(2)(h): this ensures that consumer contracts provide minimum of information related to security of electronic communications services.
In Article 20 i: this ensures that customers are duly informed by their provider of electronic communications services of whether or not access to emergency services is provided.
In Article 20 i: this ensures that end-users are clearly informed in advance of the conclusion of the contract (and regularly thereafter) of their obligations to respect copyright and related rights, as well as of the most common acts of infringements and their legal consequences. This is without prejudice to the provisions of Directive 2000/31/EC on electronic commerce i.
In Article 27 i and i: this aims to foster the development of the European Telephony Numbering Space (ETNS) which offers an opportunity for pan-European services to develop.
In Article 28 i and i: this fosters access to cross-border services, thereby contributing to the completion of the Internal Market for citizens and business.
In Article 30: in order to ensure that consumers can fully benefit from number portability, the right to number portability is no longer limited to publicly available telephone services (PATS), but is instead linked to the right to numbers from national numbering plans. In addition, the maximum time limit for the effective porting of numbers is set at one working day. Paragraph 4 introduces a procedure to allow for adjustments to future technological developments. This is complemented by amendments to Annex I, Part C. In addition, national regulatory authorities will have to ensure that consumers are not discouraged from changing service providers when it is in their interest.
In Article 31: in order to ensure that “must carry” rules are proportionate and adapted to market and technological developments, this strengthens the obligation of Member States to review and justify them.
In Article 33: the new sub-paragraph aims to ensure that the interests of consumers are adequately taken into account in the decision-making process of national regulatory authorities.
In Article 1 i: this reflects the fact that certain aspects of terminal equipment are covered by the framework. This is in line with the provisions concerning access to and use of electronic communications, including terminal equipment, for disabled users.
In Article 2(c): clarifies the definition of publicly available telephone service (PATS). It is in line with the amendment to Article 26, as the emergency services obligation is imposed only on certain providers. In addition, it is clarified that, where access to emergency services is mandated, users can make calls to the “112” number free of charge and without having to use any means of payment.
In Article 4: this makes a technical adjustment to the formulation of universal service by separating access from provision of electronic communications services. This does not affect the scope or the provision of universal service to consumers and end-users.
In Article 8 i: this allows national regulatory authorities to assess the effects of any intended disposal of the local access network to a separate legal entity by the universal service provider.
In Article 23: this amendment is in line with the introduction of a specific security chapter in the Framework Directive 2002/21/EC.
In Article 26 i: this amendment is in line with the modification to Article 2(c).
In Article 37: the Committee procedure is updated to reflect the amendments to Decision 1999/468/EC.
The following provisions are amended in order to reflect technological and market developments:
- Article 20 i and (3)
- Article 25
- Article 27 i and (2)
- Article 29
- Article 34
- Annexes I, II and III i.
In Article 1 i: the reference to the retail provision of leased lines is obsolete and thus deleted (see changes to Article 18, below).
In Article 2(b): the definition is repealed as it is no longer necessary.
Article 16 is deleted as it concerned obligations imposed on Member States in order to facilitate the transition from the regulatory package of 1998 to the 2002 framework, which are now outdated.
Article 17 i is deleted as redundant. This information is provided to the Commission by national regulatory authorities under the “Article 7 procedure”. Moreover, the Commission has the power to submit reasoned requests for information to the national regulatory authorities (Article 5 i of the Framework Directive 2002/21/EC).
Article 18 is deleted as it is no longer necessary to maintain the obligation for a minimum set of leased lines. This obligation was justified at the time of the entry into force of the 2002 framework since the market was not yet sufficiently competitive at that time. This amendment also necessitates the deletion of Annex VII, as well as a minor adjustment to Article 35.
Article 19 is deleted as redundant. It was included in the Universal Service Directive in order to facilitate the transition from the old regulatory framework of 1998 to the 2002 framework. Carrier selection and carrier pre-selection are one of the obligations that may be imposed by national regulatory authorities on operators having significant market power. Such access obligations are more appropriately handled under the Access Directive 2002/19/EC.
The aims of the proposed changes are as follows:
In Article 4 i: this ensures that end-users are notified about breaches of security resulting in their personal data being lost or otherwise compromised, and are informed about available/advisable precautions that they may take in order to minimise possible economic loss or social harm that could result from such a security breach.
In Article 4 i: this ensures a minimum level of harmonisation by granting to the Commission the possibility, where appropriate, to adopt technical implementing measures in the areas of security and breach notification, drawing on the expert advice provided by the Authority.
In Article 13 i: this introduces the possibility for, in particular, Internet Service Providers to take legal action against spammers, which should become an important tool in the fight against unsolicited commercial communications in Europe.
In Article 15a: this enhances the implementation and enforcement mechanisms currently in place, in order to enable competent authorities to take effective and efficient action against infringements. In order to ensure harmonised conditions for the provision of services involving cross-border data flows, the Commission will have the powers to adopt technical implementing measures in this area, drawing on the expert advice provided by the Authority.
In Article 2(e): this adapts the definition of “call” in order to ensure consistency throughout the Regulatory Framework.
In Article 3 i: this clarifies that the Directive applies to public communications networks supporting data collection and identification devices (including contactless devices such as Radio Frequency Identification Devices).
In Article 5 i: this ensures that use of “spyware” and other malicious software remains prohibited under EC law, regardless of the method used for its delivery and installation on a user’s equipment (distribution through downloads from the Internet or via external data storage media, such as CD-ROMs, USB sticks, flash drives etc.).
In Article 14a: this introduces a standard provision for the Committee procedure.
Article 3 i and i are deleted as redundant. Because of technological progress, the exceptions justified by technical impossibility or disproportionate economic effort will be rendered obsolete by the time the present amendments become effective.
Concerning protection of consumers against unsolicited commercial communications (spam), this amends the Regulation (EC) No 2006/2004 of the European Parliament and of the Council on cooperation between national authorities responsible for enforcement of consumer protection laws (Regulation on consumer protection cooperation i) so as to reinforce the cross-border cooperation and enforcement in line with an existing Community mechanism laid down by that regulation.